Guam Shipyard Lawsuit Settlement Talks Underway
The Port Authority of Guam and the evicted Guam Shipyard are in discussions to potentially settle a $55 million lawsuit concerning damages linked to floating cranes operated by the shipyard. During a court session on Tuesday, both parties requested an additional 60 days to negotiate. The lawsuit stems from allegations that the cranes caused significant damage during Typhoon Mawar in 2023, leading to the shipyard’s eviction last May.
Background of the Dispute
The conflict between the Port Authority of Guam and Guam Shipyard escalated last year when the Port Authority moved to evict the shipyard, citing overdue rent, lease violations, and unauthorized use of property at the Jose D. Leon Guerrero Commercial Port. Following the eviction notice, the Port Authority filed a federal lawsuit against Guam Shipyard, claiming that two floating cranes, YD 120 and YD 223, broke free during Typhoon Mawar and caused extensive damage to critical infrastructure, including Golf Pier and a seaplane ramp.
In response, attorneys for Guam Shipyard contended that the eviction was an attempt to bypass complex lease issues, asserting that the shipyard had made significant advance payments related to its lease of Hotel Wharf. The case has since been appealed to the Supreme Court of Guam, while the shipyard’s legal team has denied several allegations made by the Port Authority in the ongoing lawsuit.
As both parties navigate the legal landscape, they have requested multiple continuances in federal court to facilitate settlement discussions. A joint status report submitted to Magistrate Judge Michael Bordallo indicated that both sides are open to reaching an early resolution. The report also noted that Guam Shipyard was nearing plans to relocate the floating cranes but faced challenges in finding a suitable docking location.
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Future Steps and Developments
Potential docking sites for the cranes include Naval Base Guam, which aligns with the Navy’s high-priority plans for shipyard assets. Guam Shipyard was invited to submit a proposal to the U.S. Navy, but delays due to a federal shutdown and holiday schedules have hindered progress. A meeting with Navy officials is anticipated in the weeks following January 6, as vessel repair capabilities at Naval Base Guam remain a priority for the Navy.
The joint report also highlighted Guam Shipyard’s belief that removing the cranes is essential for accurately assessing the damage to Port property. The shipyard has requested a 60-day extension to proceed with discovery in the lawsuit. The court granted this extension, with a status update on negotiations with the Navy due by February 20. Both parties are scheduled to return to court on March 10.
In a related development, the Port Authority recently finalized a four-year, $10.5 million lease with Black Construction Corp. for Hotel Wharf, which has been vacated by Guam Shipyard. This area is expected to serve as a staging ground for Black Construction’s $571 million contract with the Navy to repair the Glass Breakwater, a vital structure that protects shipping routes in Apra Harbor.
